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Thy Will be done?

20 August 2015

The Court of Appeal has raised doubts over the robustness of Wills by overruling a mother’s final wishes.

“Your will can be ignored, say judges” – so warned a newspaper headline1 after a recent landmark ruling. The court overrode a daughter’s disinheritance by her mother, awarding her part of the estate. The press certainly found the implications of the ruling unsettling. But does the ruling make your Will less binding? And is there anything you can do about it?

Melita Jackson, the mother in question, made her last Will in 2002, leaving nothing to her only child, Heather Ilott. As she was careful to explain in a letter accompanying the Will, she disinherited Heather because she had never forgiven her for leaving home at 17 with her boyfriend, whom she later married. After Mrs Jackson died in 2004, her not inconsiderable estate of £468,000 was divided among three animal charities, for whom she cared little.

Mrs Ilott challenged the Will in 2007 and was awarded £50,000 after a district judge decided she had been “unreasonably” excluded by Mrs Jackson. After some judicial to-ing and fro-ing, the Court of Appeal has now more than tripled that to £164,000, to allow Mrs Ilott to buy the home she was renting from a housing association.

Last wishes?

Once, a Will was regarded as a sacrosanct expression of the deceased’s wishes. Summing up before a court in 1873, barrister Sir James Hannen described an English person’s testamentary freedom in unflinching terms:

“He may disinherit, either wholly or partially, his children, and leave his property to strangers to gratify his spite, or to charities to gratify his pride, and we must give effect to his will, however much we may condemn the course he has pursued.”

The Inheritance (Provision for Family and Dependants) Act 1975 opened a chink in that armour. It allows certain people who have not been provided for with “reasonable financial provision” from a deceased’s estate to seek to change how the assets are distributed. These were the grounds on which Heather claimed.

“A parent still has no obligation to leave any part of their estate to their children – unlike in, say, most of Europe,” advises Tony Müdd, divisional director at St. James’s Place. “But the Act now requires courts to look favourably on applications by adult children in certain circumstances.” These include where the applicant:

Suffers from some form of disability; or

Was financially dependent on the deceased; or

Will face financial difficulties if little or no provision is made

Mrs Ilott showed that she fell into the last category, but her case may not necessarily set an absolute precedent. In another recent case, Wright v Waters, Mrs Wright’s mother died without making any provision for her daughter or her daughter’s children. Instead, she left most of her estate to her son and his family. The daughter made a claim under the Act, saying she was suffering from ill health and facing severe financial difficulties as a result.

As in the Ilott case, mother and daughter had not spoken for a considerable time, and their relationship had clearly broken down. Despite the similarities in the two cases, however, the judge rejected this claim, saying it had been “objectively reasonable” for the deceased to have left nothing to Mrs Wright.

Prudent steps

“While the Ilott decision doesn’t change the law, it may encourage more disputes over Wills that exclude adult children,” suggests Müdd. “The question that the courts will consider is not whether the deceased ought to have left money to a child, but whether the provision (or lack of it) was reasonable in the light of the facts.”

Will disputes are expensive and, quite apart from the costs, can greatly increase family tensions. You should make sure that your Will is properly drafted and executed by a qualified and experienced individual. “Try to avoid disinheriting anyone who could contest the Will under the Act but, if you still wish to, be very clear as to the reasons and document them. Be sure to understand the implications for other family members or beneficiaries,” suggests Müdd.

Remember too that gifts made into a trust* during the donor’s lifetime can’t be contested under the Act, and so may be a safer way of disinheriting, rather than using a Will.

1Telegraph, 27 July 2015’TH

Will writing involves the referral to a service that is separate and distinct to those offered by St. James’s Place. Wills and trusts* are not regulated by the Financial Conduct Authority.

The Partner Practice represents only St. James's Place Wealth Management plc (which is authorised and regulated by the Financial Conduct Authority) for the purpose of advising solely on the Group's wealth management products and services, more details of which are set out on the Group's website www.sjp.co.uk/about-st-james-place/our-business/our-products-and-services. The 'St. James's Place Partnership' and the titles 'Partner' and 'Partner Practice' are marketing terms used to describe St. James's Place representatives. Queens Square Wealth Management Ltd is registered in England and Wales, Number 7360700. Registered Office: 3 Kingsmead Terrace, Bath, BA1 1UX.

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